Innovation in Portugal: What do we know? What would we like to know? What would we like to know?...

37
Innovation in Innovation in Portugal: Portugal: What do we know? What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel Heitor Heitor Center for Innovation, Technology and Policy Research, Center for Innovation, Technology and Policy Research, IN+, IN+, Fundação Calouste Gulbenkian, 2 October Fundação Calouste Gulbenkian, 2 October 2003 2003 Work partially funded by OCES

Transcript of Innovation in Portugal: What do we know? What would we like to know? What would we like to know?...

Page 1: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

Innovation in Portugal: Innovation in Portugal:

What do we know?What do we know? What would we like to know?What would we like to know?

Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel HeitorManuel J. Bóia, Pedro Conceição, Rui Santos and Manuel Heitor

Center for Innovation, Technology and Policy Research, IN+,Center for Innovation, Technology and Policy Research, IN+,Instituto Superior Tecnico, Lisbon, Instituto Superior Tecnico, Lisbon, http://in3.dem.ist.utl.pt

Faculdade de Ciências Sociais e Humanas, Universidade Nova de LisboaFaculdade de Ciências Sociais e Humanas, Universidade Nova de Lisboa

Fundação Calouste Gulbenkian, 2 OctoberFundação Calouste Gulbenkian, 2 October 2003 2003

Work partially funded by OCES

Page 2: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

OutlineOutline1.1. From From Catching-upCatching-up to to Forging AheadForging Ahead……

2. The Third Community Innovation Survey, CIS 32. The Third Community Innovation Survey, CIS 3

3. Convergence3. Convergence• Performance Improvements in Main IndicatorsPerformance Improvements in Main Indicators Leading towards the EU MeanLeading towards the EU Mean

4. Purely quantitative vs. qualitative convergence4. Purely quantitative vs. qualitative convergence• Do results indicate latecomer growth?Do results indicate latecomer growth? Do qualitative weaknesses remain?Do qualitative weaknesses remain? Or is there evidence of qualitative changes as well?Or is there evidence of qualitative changes as well?

5. Conclusions5. Conclusions What do we know?What do we know? What would we like to know?What would we like to know?

Page 3: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

The Imperative: improve productivity and efficiency,

not the extension with which resources are used

G7

Euro Area

América do Norte

Portugal

Grécia

Hungria

Nova Zelândia

Japão

Islândia

AustráliaEspanha

Canadá

Finlândia

Reino Unido

Suécia

Suiça

Irlanda

Dinamarca

Alemanha

Áustria

Holanda

EUA

Itália

França

Noruega

Luxemburgo

-20

-15

-10

-5

0

5

10

15

20

-50 -40 -30 -20 -10 0 10 20 30 40 50

Diferença da Produtividade Horária Face à Média Comunitária

Efe

ito

do

me

ro d

e H

ora

s d

e T

rab

alh

o

Produtividade horária menor que a média EU-15Menos horas de trabalho do que a média EU-15

Produtividade horária maior que a média EU-15Menos horas de trabalho do que a média EU-15

Produtividade horária maior que a média EU-15Mais horas de trabalho do que a média EU-15

Produtividade horária menor que a média EU-15Mais horas de trabalho do que a média EU-15

Contributions of Hourly Productivity and of Hours Worked to the “Gap” in GDP per Capita (1998)

Page 4: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

How to increase productivity? There is a need to enhance innovation.

Why? Because Portugal is already competitive in low value-added activities.

0% 20% 40% 60% 80% 100%

EU

OCDE

Polónia

República Checa

Turquia

Grécia

Espanha

Portugal

Hungria

México

Noruega

Bélgica/Luxemburgo

Finlândia

Itália

Coreia

Nova Zelândia

Holanda

França

Reino Unido

Canada

Austria

Dinamarca

Suécia

Alemanha

Japão

Irlanda

EUA

Austrália

Suiça

Percentagem das Exportações para a União Europeia (1996)

Alto Valor

Médio Valor

Baixo Valor

Proportion of Exports According to the Price/Quality Ratio (Value) of Exported Goods (EUROSTAT)

Page 5: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

What is lacking to enhance productivity? a) R&D investment, namely by firms

Reino Unido

Turquia

Suiça

Suécia

Espanha

Portugal

PolóniaNoruega

Holanda

Itália

Irlanda

Hungria

Grécia

Alemanha

França

Finlândia

Dinamarca

República Checa

Bélgica

Nova Zelândia

Coreia Japão

Austrália

EUA

México

Canada

R2 = 0.7(exceptuando Irlanda e México)

0

5

10

15

20

25

30

35

40

45

50

0 0.5 1 1.5 2 2.5 3 3.5 4Intensidade em I&D na Indústria

(Despesa em I&D na Indústria/Produção Industrial)

Es

pe

cia

liza

çã

o d

as

Ex

po

rta

çõ

es

em

Se

cto

res

de

Alt

a T

ec

no

log

ia(E

xpo

rta

çõe

s e

m A

lta T

ecn

olo

gia

/To

tal d

e E

xpo

rta

çõe

s)

High Tech Exports and R&D Intensity in Firms (OCDE,2002)

Page 6: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

1.6%

1.8%

2.2%

2.7%

3.2%

3.3%

3.5%

3.8%

3.9%

4.1%

4.3%

7.0%

0.7%

1.2%

2.5%

4.0%

2.1%

3.0%

1.6%

1.3%

3.0%

2.4%

3.8%

Portugal

Espanha

Bélgica

Noruega

Reino Unido

Irlanda

Áustria

Holanda

França

Alemanha

Finlândia

Suécia

Indústria Serviços

Firm Revenues Invested in Activities Oriented towards Innovation

What is lacking to enhance productivity? b) expenditure on innovation

Page 7: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

c) Portugal also lacks technical skills and competencies

What is lacking to enhance productivity?

Highest Level of Education Attained: Population of 25-64 Years Old (2001)(Source: OECD, Education at a Glance 2002)

0 10 20 30 40 50 60 70 80 90

Portugal

Turkey

Spain

Italy

Greece

Luxemburg

Belgium

Ireland

Netherlands

France

Hungary

Austria

Finland

Germany

Poland

Denmark

Sweden

Norway

UK

Slovakia

Czech Republic

US

Upper Secondary Education Terciary Education

Page 8: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

What is lacking to enhance productivity?

d) Portugal is behind in organizational, as much as in technological, innovation

Rotação dos Trabalhadores

Organização do Trabalho em

Equipas

Maior Envolvimento dos Trabalhadores menos Qualificados

Horizontalização das Estrutura de

Gestão

Alemanha 7 20 19 30Dinamarca 28 40 10 42Espanha 14 34 33 -França 6 30 44 21Holanda 9 9 46 47Irlanda 10 27 32 23Itália 13 28 24 10Portugal 9 22 9 3Reino Unido 13 33 48 45Suécia 38 29 60 46Média (não ponderada) 15 27 33 29

Adoption of Flexible Management Practices OCDE (1999). Employment Outlook

Page 9: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

What does Portugal have going for it?

200 220 240 260 280 300 320

Chile

Portugal

Polónia

Eslovénia

Irlanda

Reino Unido

Hungria

Nova Zelândia

EUA

Austrália

Canadá

Bélgica

Finlândia

Holanda

Alemanha

Noruega

República Checa

Dinamarca

Suécia

Resultados Médios, População entre 16 e 65 Anos, 1994-1998 (Escala de 0 a 500)

Quantitativa

Leitura

Escrita

a) Portugal is now a dual country: excellence coexists with poor performance

200 220 240 260 280 300 320 340

Chile

Hungria

Polónia

EUA

Eslovénia

Irlanda

Nova Zelândia

Reino Unido

Austrália

Canadá

República Checa

Dinamarca

Bélgica

Noruega

Alemanha

Portugal

Holanda

Suécia

Finlândia

Resultados Médios, População entre 20 e 25 Anos com Educação Secundária Avançada Concluída, 1992-1998 (Escala de 0 a 500)

Written Literacy: Results for Population between 20 and 25

Years with Advanced High School Diplomas

Literacy: Results for the Entire Population

Page 10: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

b) Portugal has been growing fast, but less so than other “catching-up” countries

What does Portugal have going for it?

Canada

México

EUA

AustráliaJapão

Coreia

Nova Zelândia

Austria Bélgica

Dinamarca

Finlândia

FrançaAlemanha

Grécia

Hungria

Irlanda

Itália

HolandaNoruegaPolónia

PortugalEspanha

Suécia

Suiça

Turquia

Reino Unido

EU

OCDE

0

5

10

15

20

25

30

-10 -5 0 5 10 15 20 25 30

Taxa Média de Crescimento Anual de Patentes Submetidas ao EPO (1990-1996)

Ta

xa

dia

de

Cre

sc

ime

nto

An

ua

l d

e A

rtig

os

Cie

ntí

fic

os

Pu

bli

ca

do

s

(19

90

-19

95

)

Variation in the Number of Patents and Number of Published Scientific Articles

Page 11: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

What does Portugal have going for it?

c) Portugal has a new wealth in incoming people

-50.0% 0.0% 50.0% 100.0% 150.0% 200.0% 250.0% 300.0% 350.0%

EU

OCDE

França

Australia

Bélgica

Holanda

Canada

Suécia

Noruega

Reino Unido

Alemanha

EUA

Irlanda

Suiça

Luxemburgo

Japão

Espanha

Dinamarca

Portugal

Itália

Austria

Finlândia

Crescimento da Proporção da População Estrangeira (1988-1998)

Growth in the Population of Each Country with Foreign Origin (1988-1998), OECD(2000)

Page 12: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

In the way of a summary.......

There may be agreement on some general and generic areas for investment (education, science and technology, infrastructures, “social capital” defined in a broad way). But the design and implementation of specific policies meets two challenges:– The lack of understanding of the barriers and opportunities – A lack of qualified people able to understand and interpret

the developmental shortcomings of the country and of designing and implementing, at the firm level or in the public sector, the measures that could overcome these shortcomings.

Portugal needs to jump from a “catching-up” model of economic growth and development, to a model of “forging-ahead” by exploring creativity and ingeniousness by developing and diffusing innovation.

Page 13: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

OutlineOutline1.1. From Catching-up to Forging AheadFrom Catching-up to Forging Ahead

2. The Third Community Innovation Survey, CIS 32. The Third Community Innovation Survey, CIS 3

3. Convergence3. Convergence• Performance Improvements in Main IndicatorsPerformance Improvements in Main Indicators Leading towards the EU MeanLeading towards the EU Mean

4. Purely quantitative vs. qualitative convergence4. Purely quantitative vs. qualitative convergence• Do results indicate latecomer growth?Do results indicate latecomer growth? Do qualitative weaknesses remain?Do qualitative weaknesses remain? Or is there evidence of qualitative changes as well?Or is there evidence of qualitative changes as well?

5. Conclusions5. Conclusions What do we know?What do we know? What would we like to know?What would we like to know?

Page 14: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

Survey SampleSurvey Sample• Initial Sample: Initial Sample: 47274727 firms stratified by firm size and sector firms stratified by firm size and sector

(INE–1999 Data)(INE–1999 Data)

• Corrected sample: Corrected sample: 41274127 firms firms

Sectors SurveyedSectors Surveyed• Mining and Quarrying, all Manufacturing, Utilities, Wholesale Mining and Quarrying, all Manufacturing, Utilities, Wholesale

Trade and a selection of industries in the Service SectorTrade and a selection of industries in the Service Sector

Survey Target PopulationSurvey Target PopulationAll Manufacturing and Service firms with more than 10 employeesAll Manufacturing and Service firms with more than 10 employees

2. The Third Community innovation Survey: CIS 32. The Third Community innovation Survey: CIS 3Application to PortugalApplication to Portugal

Innovation Defined as: Innovation Defined as: Market introductionMarket introduction of a product (Good or Service) of a product (Good or Service) new or significantly improvednew or significantly improved, or the introduction of new or significantly , or the introduction of new or significantly improved processes, based on new technological developments, new improved processes, based on new technological developments, new combinations of existing technologies or on the use of other type of knowledge combinations of existing technologies or on the use of other type of knowledge acquired.acquired.

Page 15: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

• Harmonized questionnaire (the same for Services and Manufacturing and other Harmonized questionnaire (the same for Services and Manufacturing and other industries)industries)

• Questions regarding:Questions regarding:

General InformationGeneral Information

Basic Economic InformationBasic Economic InformationProduct and Process InnovationProduct and Process InnovationPatents and Other Protection MethodsPatents and Other Protection Methods

Innovation Activities and ExpenditureInnovation Activities and ExpenditureIntramural R & DIntramural R & DOther Strategic and Organizational Important ChangesOther Strategic and Organizational Important Changes

Effects of InnovationEffects of InnovationPublic FundingPublic FundingInnovation Co-operationInnovation Co-operationSources of Information for InnovationSources of Information for InnovationHampered Innovation ActivityHampered Innovation Activity

Companies Characteristics

Innovation Extension

Companies Options

Systemic Characteristics

2. The Third Community innovation Survey2. The Third Community innovation Survey QuestionnaireQuestionnaire

Page 16: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

3. Convergence : 3. Convergence : Performance Improvements as Measured by Main Quantitative IndicatorsPerformance Improvements as Measured by Main Quantitative Indicators

Main indicators CIS II/CIS IIIServices

0%

20%

40%

60%

80%

100%

CIS II CIS III

Eff iciency Rate

Engaged

Inovators

Main indicators CIS II/CIS IIIManufacture

0%

20%

40%

60%

80%

100%

CIS II CIS III

Eff iciency Rate

Engaged

Innovators

Process

Product

Main indicators CIS II/CIS IIIAll

0%

20%

40%

60%

80%

100%

CIS II CIS III

Eff iciency Rate

Engaged

Inovators

(results obtained throuhg OCES)

Page 17: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

Ireland

Austria

Germany

Netherlands

UK

Sweden

Norway

France

Luxemburg

Belgium

0%

20%

40%

60%

80%

100%

20% 40% 60% 80% 100%

Proportion of Manufacturing Innovating Enterprises

Proportion of Service

Innovating Enterprises

PortugalItaly

(1) For comparison with the data of 1995-1997 some Sub sectors (NACE 63, 73, 74.3 e 64 except 64.2) and the manufacturing companies in between 10 and 20 employees which were part of the CIS 3 survey are not considered

(2) Includes the results not considered in (1).Note: Final disaggregated and comparable results are not yet available for the other

participants in the exercise.

(1)(2)

CIS III(Preliminary)

CIS II

Finland

3. Convergence3. ConvergenceLeading the Convergence towards the EU MeanLeading the Convergence towards the EU Mean

Page 18: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

Ireland

GermanyAustria

NetherlandsUK

Sweden

NorwayFrance

Finland

BelgiumPortugal

0%

20%

40%

60%

80%

0.0% 2.0% 4.0% 6.0% 8.0%

Expenditure in Innovating Activities as Share of Turnover

Po

rpo

rtio

n o

f In

no

va

tiv

e E

nte

rpri

se

s

Manufacturing Sector

CIS III(Preliminary)

CIS II

3. Convergence: 3. Convergence: Input vs OutputInput vs Output

Page 19: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

3. Convergence3. ConvergenceSmaller Improvement in the Share of Turnover due to InnovationSmaller Improvement in the Share of Turnover due to Innovation

Share of Turnover due to New or Improved Products

CIS II/CIS III

0,0%

5,0%

10,0%

15,0%

20,0%

CIS II CIS III

Manufacture

Services

Page 20: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

Or Or

Is there evidence of qualitative Is there evidence of qualitative changes as well?changes as well?

4. Purely quantitative vs. qualitative convergence4. Purely quantitative vs. qualitative convergence

Do results indicate latecomer growth?Do results indicate latecomer growth?

Do qualitative weaknesses remain?Do qualitative weaknesses remain?

Questions to be raised:

Page 21: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.14.1 Evidence Supporting Qualitative Evidence Supporting Qualitative ChangeChange

ME’s Catching UpME’s Catching Up

0

10

20

30

40

50

60

70

80

90

1995-1997 1998-2000(1)

1998-2000(2)

1995-1997 1998-2000(1)

1998-2000(2)

1995-1997 1998-2000(1)

1998-2000(2)

Manufacturing Services National (3)

Prop

ortio

n of

Inno

vatin

g En

terp

rises

(%)

Small Medium Large Manufaturing Total Services Total National Total

(results obtained throuhg OCES)

Page 22: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

0102030405060708090

100C

oke

an

dC

he

mic

als

Ma

chin

ery

an

dE

qu

ipm

en

t

Tra

nsp

ort

Eq

uip

me

nt

Ele

ctri

cal a

nd

Op

tica

lE

qu

ipm

en

tB

asi

c M

eta

lsa

nd

Fa

bri

cate

dR

ub

be

r a

nd

Oth

er

No

n-

Me

talli

cM

an

ufa

ctu

rin

gN

EC

an

dR

ecy

clin

gF

oo

dp

rod

uct

s;B

eve

rag

es

Wo

od

, Pu

lpa

nd

Pu

blis

hin

g

Te

xtile

s a

nd

Le

ath

er

High and Medium-High Medium-Low Low

Technological Sectors (CIS II)

Pro

po

rtio

n o

f In

no

vatin

g E

nte

rpri

ses

(%)

0102030405060708090

100C

oke

an

dC

he

mic

als

Ma

chin

ery

an

dE

qu

ipm

en

t

Tra

nsp

ort

Eq

uip

me

nt

Ele

ctri

cal a

nd

Op

tica

lE

qu

ipm

en

tB

asi

c M

eta

lsa

nd

Fa

bri

cate

dR

ub

be

r a

nd

Oth

er

No

n-

Me

talli

cM

an

ufa

ctu

rin

gN

EC

an

dR

ecy

clin

gF

oo

dp

rod

uct

s;B

eve

rag

es

Wo

od

, Pu

lpa

nd

Pu

blis

hin

g

Te

xtile

s a

nd

Le

ath

er

High and Medium-High Medium-Low Low

Technological Sectors (EVCISII)

Pro

po

rtio

n o

f In

no

vatin

g E

nte

rpri

ses

(%)

0102030405060708090

100C

oke

an

dC

he

mic

als

Ma

chin

ery

an

dE

qu

ipm

en

t

Tra

nsp

ort

Eq

uip

me

nt

Ele

ctri

cal a

nd

Op

tica

lE

qu

ipm

en

tB

asi

c M

eta

lsa

nd

Fa

bri

cate

dR

ub

be

r a

nd

Oth

er

No

n-

Me

talli

cM

an

ufa

ctu

rin

gN

EC

an

dR

ecy

clin

gF

oo

dp

rod

uct

s;B

eve

rag

es

Wo

od

, Pu

lpa

nd

Pu

blis

hin

g

Te

xtile

s a

nd

Le

ath

er

High and Medium-High Medium-Low Low

Technological Sectors (CIS III)

Pro

po

rtio

n o

f In

no

vatin

g E

nte

rpri

ses

(%)

4.14.1 Evidence Supporting Qualitative Evidence Supporting Qualitative ChangeChange

Innovation pervades the economyInnovation pervades the economy

Note: Note: Less confined to the Technologically advanced sectorsLess confined to the Technologically advanced sectors

(results obtained throuhg OCES)

Page 23: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.14.1 Evidence Supporting Qualitative Evidence Supporting Qualitative ChangeChange

Shift of innovation expenditure toward intangibles: services sectorShift of innovation expenditure toward intangibles: services sector

However, weak However, weak and ambiguous in and ambiguous in

the the manufacturing manufacturing

firms - decrease firms - decrease in marketing & in marketing & training, rise in training, rise in

R&D…R&D…

0% 10% 20% 30% 40% 50% 60% 70% 80%

Acquisition of Machineryand Equipment

Design, Training andMarketing

Intramural R&D

Extramural R&D

Acquisition of otherExternal Knowledge

Proportion of Total Innovation Expenditures in 2000 (%)

1998-2000 1995-1997

Manufacturing

(E

xpe

nd

iture

s)

0% 10% 20% 30% 40% 50% 60% 70% 80%

Acquisition of Machineryand Equipment

Design, Training andMarketing

Intramural R&D

Extramural R&D

Acquisition of otherExternal Knowledge

Proportion of the Total Innovation Expenditure (%)

1998-2000 1995-1997

(E

xpe

nd

iture

s)

Services

Page 24: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.14.1 Evidence Supporting Qualitative Evidence Supporting Qualitative ChangeChange

… … consistent with the rise of BERD since 1997, still quite low by EU standards…consistent with the rise of BERD since 1997, still quite low by EU standards…

(Source: R&D Survey, IPCTN, 2002)(Source: R&D Survey, IPCTN, 2002)

Business Expenditure in R&D and average growth rates, 1992-2001

0

10000

20000

30000

40000

50000

60000

1992 1995 1997 1999 2001

Millio

n P

TE

-5%

0%

5%

10%

15%

20%

25%

30%

Gro

wth

ra

te

BERD at constant 1995 prices

Annual growth rates

Page 25: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.14.1 Evidence Supporting Qualitative Evidence Supporting Qualitative ChangeChange

… … and with the observed correlation between technological and other innovationsand with the observed correlation between technological and other innovations

-

10.0

20.0

30.0

40.0

50.0

60.0

70.0 C

hang

ing

En

terp

rise'

sM

ark

etin

gC

once

pts

/Str

ate

gie

s

Adv

ance

dM

ana

gem

ent

Tech

niqu

es

Sig

nific

ant

Ae

sthe

tics'

Cha

nge

Ne

w C

orp

orat

eS

trate

gie

s

Cha

nge

dO

rga

niza

tion

alS

truc

ture

s

Cha

ngi

ng

Ent

erp

rise'

sM

arke

ting

Co

ncep

ts/S

trate

gie

s

Ad

vanc

edM

ana

gem

ent

Tech

niq

ues

Sig

nifi

cant

Aes

thet

ics'

Cha

nge

New

Cor

pora

teS

trate

gies

Ch

ang

edO

rgan

izat

iona

lS

truct

ure

s

Non-Innovators Innovators

Pro

porti

on

of E

nte

rpri

ses

(%)

Manufacturing Services

(results obtained throuhg OCES)

Page 26: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.24.2 Evidence Supporting persistent Evidence Supporting persistent structural weaknessesstructural weaknesses

Industrial structure skewed to very small and small enterprises...Industrial structure skewed to very small and small enterprises...

CIS III population by size

0%

20%

40%

60%

80%

100%

Manufacture Services All

Small

Medium

Large

Page 27: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.24.2 Evidence Supporting persistent Evidence Supporting persistent structural weaknessesstructural weaknesses

… … which are much less prone to innovate…which are much less prone to innovate…

CIS III

0

10

20

30

40

50

60

70

80

90

100

Manufacturing Services NationalPro

porti

on o

f Inn

ovat

ing

Ent

erpr

ises

(%)

10 to 19 20 to 49 50 to 99 100 to 249 250 to 499 More than 500 employees

(results obtained throuhg OCES)

Page 28: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.24.2 Evidence Supporting persistent Evidence Supporting persistent structural weaknessesstructural weaknesses

… … and to middle-low and low technology sectors…and to middle-low and low technology sectors…

CIS III population by Technological Intensity

0%

20%

40%

60%

80%

High andMedium-HighTechnologies

Medium-LowTechnologies

LowTechnologies

Page 29: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.24.2 Evidence Supporting persistent Evidence Supporting persistent structural weaknessesstructural weaknesses

… … also less innovativealso less innovative

0

10

20

30

40

50

60

70

80

90

100

Small Medium Large

Enterprise Dimension

Pro

po

rtio

n o

f In

no

vativ

e E

nte

rpri

ses

(%)

Low Medium-Low High and Medium-High Technological Sectors

Page 30: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.24.2 Evidence Supporting persistent Evidence Supporting persistent structural weaknessesstructural weaknesses

Limited market scopeLimited market scope

Main market scope of innovative enterprises

0%

20%

40%

60%

80%

100%

Manufacture Services Total

International

National

Local

• The restriction of most firms' targets to the national and local markets sets The restriction of most firms' targets to the national and local markets sets lower innovative challenges;lower innovative challenges;• It also accounts for the unusually high percentage of products "new to the It also accounts for the unusually high percentage of products "new to the market“, especially of servicesmarket“, especially of services

Page 31: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.24.2 Evidence Supporting persistent Evidence Supporting persistent structural weaknessesstructural weaknesses

Protection MethodsProtection Methods

• Protection of innovation, though mainly developed in house and new to the market, Protection of innovation, though mainly developed in house and new to the market, relies heavily on informal procedures (secrecy, complexity of design, time-to-market)relies heavily on informal procedures (secrecy, complexity of design, time-to-market)

• This also helps to explain the persistence of a low use of formal IPR (patents, This also helps to explain the persistence of a low use of formal IPR (patents, registration of design patterns, copyright): The only exception is trademarks.registration of design patterns, copyright): The only exception is trademarks.

0.0

5.0

10.0

15.0

20.0

25.0

30.0

Non

-In

nova

tors

Inno

vato

rs

Non

-In

nova

tors

Inno

vato

rs

Non

-In

nova

tors

Inno

vato

rsManufacturing Services National

Pro

port

ion

of E

nter

pris

es P

rote

ctin

g In

nova

tions

(%

)

At least one Formal Method At least one Informal Method

Patent Applications

-

200

400

600

800

1,000

1,200

1,400

Non

-In

nova

tors

Inno

vato

rs

Non

-In

nova

tors

Inno

vato

rs

Non

-In

nova

tors

Inno

vato

rs

Manufacturing Services NationalN

umbe

r of

Pat

ent A

pplic

atio

ns

Page 32: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.24.2 Evidence Supporting persistent Evidence Supporting persistent structural weaknessesstructural weaknesses

The relatively low academic qualification of the labor force persists, The relatively low academic qualification of the labor force persists, especially in the manufacturing sectorespecially in the manufacturing sector

This is all the more important as there is a significant difference This is all the more important as there is a significant difference in in

qualification between innovative and non-innovative firmsqualification between innovative and non-innovative firms

Workforce with tertiary education

0%

5%

10%

15%

20%

25%

Manufacture Services Total

Non-innovative Innovative

Page 33: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.24.2 Evidence Supporting persistent Evidence Supporting persistent structural weaknessesstructural weaknesses

As in CIS II, firms' perception of the obstacles hindering innovation As in CIS II, firms' perception of the obstacles hindering innovation contrasts with that of EUcontrasts with that of EU

0

5

10

15

20

25

30

35

40

45

50

Qua

lifie

dP

erso

nnel

Org

anis

atio

nal

Rig

iditi

es

Inno

vatio

n C

osts

Sou

rces

of

Fin

ance

Info

rmat

ion

onT

echn

olog

y

Eco

nom

ic R

isks

Info

rmat

ion

onM

arke

ts

Reg

ulat

ions

and

Sta

ndar

ds

Cus

tom

erR

espo

nsiv

enes

s

Pro

porti

on o

f Ent

erpr

ises

(%)

CIS III CIS II CIS II EU Average

Page 34: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

4.24.2 Evidence Supporting persistent Evidence Supporting persistent structural weaknessesstructural weaknesses

• Firms tend not to consider, and even less than in Firms tend not to consider, and even less than in

CIS II, organizational rigidities and lack of qualified CIS II, organizational rigidities and lack of qualified

personnel as barriers.personnel as barriers.

• Firms overemphasize obstacles beyond their control Firms overemphasize obstacles beyond their control (finance, costs, risk) and underemphasize those they (finance, costs, risk) and underemphasize those they can influence.can influence.

• But both qualification of personnel and organizational But both qualification of personnel and organizational

change are in fact associated to innovative firms, and change are in fact associated to innovative firms, and

Portugal has comparatively under-qualified workforcePortugal has comparatively under-qualified workforce

Page 35: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

• The The innovative performance of Portuguese firms has innovative performance of Portuguese firms has improvedimproved over the second half of the 1990s, as far as one can over the second half of the 1990s, as far as one can learn from self-reported indicators.learn from self-reported indicators.

5. Conclusions I:5. Conclusions I: What do we know?What do we know?

• Technological innovation appears to be strongly correlated Technological innovation appears to be strongly correlated withwith Organizational Innovation and Change Organizational Innovation and Change -- there may be there may be limited value-added and returns in looking at technological or limited value-added and returns in looking at technological or organizational innovation per se.organizational innovation per se.

• Important structural weaknesses remainImportant structural weaknesses remain – both – both associated with factors external to the firms and with firm associated with factors external to the firms and with firm behavior, with firms attributing more importance to the former behavior, with firms attributing more importance to the former when asked to indicate barriers to innovationwhen asked to indicate barriers to innovation

• The enhancement in innovative performance has been The enhancement in innovative performance has been accompanied by limited, but significant, accompanied by limited, but significant, structural changesstructural changes – – that is, the improvement in performance goes beyond that is, the improvement in performance goes beyond catching-up dynamics. catching-up dynamics.

Page 36: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

• What would the characterization of innovation in Portugal What would the characterization of innovation in Portugal would be like based, instead of self-reported indicators, on would be like based, instead of self-reported indicators, on “independent” assessments“independent” assessments? More specifically, what should ? More specifically, what should we learn, compare, typify and seek to explain about we learn, compare, typify and seek to explain about innovative processesinnovative processes as a whole? as a whole?

• What has the What has the impact of policiesimpact of policies been on the innovation been on the innovation performance of firms? When has it been positive, negative, performance of firms? When has it been positive, negative, redundant (that is, crowding-out what firms would do anyway redundant (that is, crowding-out what firms would do anyway as a response to changing market dynamics). as a response to changing market dynamics).

• What explains the What explains the correlation between technological and correlation between technological and other types of innovationother types of innovation? What are the ? What are the organizational organizational adjustment and learning costs to innovationadjustment and learning costs to innovation and how can and how can they be minimized? Which are the they be minimized? Which are the organizational organizational opportunitiesopportunities and how can they be optimized? and how can they be optimized?

5. Conclusions II:5. Conclusions II: What would we like to know?What would we like to know?

Page 37: Innovation in Portugal: What do we know? What would we like to know? What would we like to know? Manuel J. Bóia, Pedro Conceição, Rui Santos and Manuel.

55. Conclusions II:. Conclusions II: What would we like to know?What would we like to know?

• What is generic, and what is specific, to the (still weak) innovative performance of the Portuguese firms? From what we would know to be generic, which lessons from other contexts could we apply in Portugal? From the specificity, what would constitute adequate responses?

• How important is innovation to enhance the welfare of Portugal? What alternatives to “becoming more innovative” would be available to meet the challenge of reaching the European average economic performance?